SACRAMENTO – California Gov. Gavin Newsom delivered a dose of good news for homeowners on Wednesday, announcing the nation’s largest banks will voluntarily freeze mortgage payments for 90 days on families mired in the COVID-19 crisis.
Newsom said the agreement is the result of weeks of negotiations with the heads of banks like Wells Fargo, U.S. Bank, JPMorgan Chase and Citi as well as over 200 state banks and credit unions. The nonbinding agreement won’t have an income restriction, but applicants will have to document pandemic-related hardships.
“It is a significant framework to advance commitments that we have absolute certainty are real based upon personal commitments that I received directly from the leaders of these companies,” Newsom said in a press briefing Wednesday.
Vilified for their role in the Great Recession, the nation’s major banks are suddenly heeding California’s call for help. Newsom said further agreements could soon be made for ATM fees, overdraft penalties and commercial property loans.
“I want to just compliment them for their willingness to engage us and our team,” Newsom said.
Newsom’s mortgage forbearance announcement comes hours after the White House and Congress came to terms on a $2 trillion stimulus package that includes direct payments for taxpayers, unemployment assistance and business loans. The Democratic governor thanked Congress for coming to terms on the stimulus and said it will provide a particular boost to the state’s unemployment network, which has received over 1 million new claims in the last two weeks.
“On behalf of the nation’s largest state, as governor of the world’s fifth-largest economy in the state of California, let me applaud the Speaker, applaud Sen. Schumer, applaud Democratic leadership and the compromise that was advanced with Republicans,” Newsom said.
Covid-19, the new strain of coronavirus responsible for a global pandemic, has now affected more than 454,000 worldwide with over 61,000 confirmed cases throughout the entire United States, according to data compiled by Johns Hopkins University. Data shows nearly 21,000 have died globally from the virus, including over 880 deaths in the United States.
As of Wednesday morning, Newsom says the state has more than 2,500 confirmed cases – third-most of any state – along with 53 deaths.
— By Nick Cahill